Central Electricity Supply Utility of Odisha

2nd Floor, IDCO Tower, Janpath,Bhubaneswar

DETERMINATION OF OPEN
ACCESS CHARGES
FOR THE FY 2017-18

W.E.F-Dt.01.04.2017
 BEFORE THE ODISHA ELECTRICITY REGULATORY COMMISSION
B H U B A N E S W A R.
Filing No.
Case No.

IN THE MATTER OF: (An application for Wheeling charge, Surcharge

and additional surcharge for the Financial Year
2017-18 under The Electricity Act 2003, and
OERC (Terms and conditions for Open Access)
Regulation 2005, OERC (Determination of Open
Access Charge) Regulation,2006 and other tariff
related matter.)

AND

IN THE MATTER OF: Central Electricity Supply Utility of Odisha, 2nd

Floor, IDCO Towers, Bhubaneswar – 751 022
represented by its Chief Executive Officer.

…... .Applicant

THE HUMBLE APPLICANT ABOVE NAMED MOST RESPECTIFULLY

SHEWETH:

1. That the Central Supply Utility of Odisha is required to file the

application for approval of Open Access Charges for the
FY 2017-18 as per Clause-4 of OERC (Determination of Open
Access Charges) Regulation – 2006.
2. That CESU has submitted the Aggregate Revenue Requirement
(ARR), the Tariff for Wheeling Business and the Retail Business
application for the FY 2017-18 before the Hon’ble Commission
for consideration.
3. That for calculation of Open Access charges for the FY 2017-18,
the projected figures for sales of energy, power purchase and
distribution cost for FY 2017-18 are taken into consideration.
4. That the surcharge for Open Access by HT/EHT consumes are
computed considering the approved Retail Supply Tariff for the
FY 2016-17.

Cont’d……P/2.
 -2-

5. That for determination of Open Access charges for the

FY 2017-18, Retail Supply Tariff approved by the Hon’ble
Commission for FY 2016-17 has been considered.

PRAYER

In view of the above, it is respectfully prayed that the Hon’ble

Commission may kindly be pleased to:

I. Accept Open Access charges application of the applicant.

II. Approve Open Access charges of the Utility for the FY 2016-17.
III. Grant any other relief as deemed fit and proper in the eyes of
law.

And for this action of kindness the applicant as in duty ground

shall every pray.

BY THE APPLICANT THROUGH

Bhubaneswar (Prasanna Kumar Dash)

Date: 28.11.2016 CHIEF EXECUTIVE OFFICER
 BEFORE THE ODISHA ELECTRICITY REGULATORY COMMISSION
B H U B A N E S W A R.

Filing No.
Case No.

IN THE MATTER OF: (An application for Wheeling charge, Surcharge

and additional surcharge for the Financial Year
2017-18 under The Electricity Act 2003, and
OERC (Terms and conditions for Open Access)
Regulation 2005, OERC (Determination of Open
Access Charge) Regulation,2006 and other tariff
related matter.)

AND

IN THE MATTER OF: Central Electricity Supply Utility of Odisha, 2nd

Floor, IDCO Towers, Bhubaneswar – 751 022
represented by its Chief Executive Officer.

…... .Applicant

THE HUMBLE APPLICANT ABOVE NAMED MOST RESPECTIFULLY

SHEWETH:

I Sri Prasanna Kumar Dash,, S/o Late Sri B.N. Dash, aged about
58 years residing at Bhubaneswar do here by solemnly affirm and say
as follows:

1. I am the Chief Executive Officer of Central Electricity Supply

Utility of Odisha, the applicant in the above matter and duly
authorized to swear this affidavit on its behalf.

2. The statements made in Para 1 to 5 herein shown to me are

based on information and I believe them to be true.

BY THE APPLICANT THROUGH

Bhubaneswar (PRASANNA KUMAR DASH)

Date: 28.11.2016 CHIEF EXECUTIVE OFFICER
 APPLICATION FOR OPEN ACCESS CHARGES FOR FY 2017-18

CESU being a distribution licensee for Central Zone Electricity Distribution

network of Orissa is required to submit proposal for approval of Open Access charges
before the Hon’ble Commission for the FY 2017-18 as per the provisions of Sub Section
(2), (3) & (4) of Section 42 of I.E. Act 2003 , OERC (Terms & Conditions for
Determination of Tariff) Regulations – 2004, OERC (Terms and conditions for Open
Access) Regulation, 2005 and OERC (Determination of Open Access Charges) Regulation,
2006. Any customer under the license area of CESU intending to avail one MW or more
power from any other Utility or generator availing open access facility of distribution
network of the Licensee may do so, by paying Open Access Charges applicable from time
to time. This application is for approval of open access charges for FY 2017-18. For
determination of open access charges the Financial Year 2017-18, the Licensee
considered following figures of its ARR application for FY 2017-18.

a) Projected distribution cost.

b) Estimated bulk energy purchase and sales to different category of consumers
availing supply in LT/HT/EHT network.
c) Retail & bulk supply tariff approved for FY 2016-17.
Further the computations of Open Access Charges are based on following
assumptions which are justified and incumbent to the Electricity distribution system.

1. The Open Access charges are applicable to both long-term and short-term
customers.
2. Open Access applicants requiring load more than 1MW are only envisaged in this
application. Load below 1 MW is not considered as this does not appear in
Section 11 “Phasing of Open Access” in OERC (Terms & Condition of Open
Access) regulations 2005.
3. Wheeling charge is payable to avail Open Access to HT network only. (33KV or
11KV)

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5. For surcharge calculation Avoided Cost method is adopted as per
recommendations of Forum of Indian Regulators.
6. Bulk tariff, transmission & SLDC charges are as approved for FY 2016-2017.
7. Approved loss level in EHT and HT for FY 2016-17.
8. Power factor at normative level of 90%.
9. Open Access for LT customers not envisaged as load above 1 MW need to be
availed in HT as per section 76 (3) of OERC (Distribution Conditions of Supply)
Code 2004.
1: Wheeling charge for Open Acess:
The Licensee estimated following bulk power purchase and Sales to
customers at different voltage level for FY 2017-18.
o Bulk Power Purchase – 9094.05 Million Units.
o Sale to EHT customers— 872.626 Million Units.
o Sale to HT customers—1354.24 Million Units.
o Sale to LT customers—4062.59 Million Units
Total unit to be wheeled in the distribution network of CESU is equal
to 8221.424 MU i.e. total power purchase minus the EHT sales.
Total Wheeling cost for the Financial Year 2017-18 is tabulated below:-
Particulars (Rs.in crores)
Employee cost 356.14
Repair & Maintenance
115.71
cost
Administrative &
19.13
General Expenses
Interest & Finance cost 240.12
Bad debt provision 25.34
Reasonable Return 10.47
Depreciation 106.16
Total 847.74
Wheeling charge per unit = [Rs.847.74Crs ] / [8221.424 MU] = Rs 103.12 paise
per unit.
So, CESU proposes wheeling charge of Rs 103.12 paise per unit for Open
Access HT customers for the FY 2017-18.

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2: Cross subsidy surcharge:

2.1: For HT Open Access consumers:

The basic principle of surcharge to be levied on open access customers is to

compensate the incumbent utility for the revenue loss due to migration of the
existing customer to another utility/CGP/IPP or any other party.
From HT consumer revenue earning per unit to CESU is equivalent to
differential of rate of sale per unit and sum of BST price, transmission & SLDC
charge appropriated with distribution loss in HT.
Distribution loss in HT network is proposed to be 8% for the FY 2017-18
and transmission loss at 3.70% as approved in the transmission tariff order for the
FY.2016-17.
Revenue earning is computed at 100% load factor only as open access consumers
are allowed to avail open access power round the clock and which is shown in the
following table.

Normal Energy Normal Energy

Demand
charges. charges.
Charge Power factor
<=60% >60%
(Rs./ KVA)
(P/KWH) (P/KWH)
Existing
Tariff 250 525 420 0.9
Rate

CD Max units per Avg. energy Demand charge Total

Incremental
(KVA) month charge rate component rate
L.F (%)
Units (KWH) (P/KWH) (P/KWH) (P/KWH)

1 100 657 483.00 38.05 521.05

Surcharge (S) applicable for HT category of consumers is calculated

as per following formula in compliance to Section (2) ‘Surcharge” of OERC
(Determination of Open Access Charges) Regulations 2006:
S = T - [ C /(1-L/100) +D+R ]
Where T is the tariff payable by the relevant category of consumers,
including reflecting the Renewable Purchase Obligation. (521p)

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 C is the per unit weighted average cost of power purchase by the
Licensee, including meeting the Renewable Purchase Obligation. (270p)
D is the aggregate of transmission, distribution and wheeling charge
applicable to the relevant voltage level . (25 paise)
L is the aggregate of transmission, distribution and commercial
losses, expressed as a percentage applicable to the relevant voltage level
(8%).
R is the per unit cost of carrying regulatory assets.
Applying the above formula rate of cross subsidy surcharge is calculated as
203Paisa/ unit.
The above rate is applicable to following category of consumers.

General Purpose >70KVA

Specified Public Purpose

Public Water Works sewerage pumping

Large Industry

Power Intensive Industry

Mini Steel Plant

Railway Traction
Further, for Emergency Supply to CGP/ IPP category of consumers the
surcharge is calculated to 402p/unit for HT consumers based on the similar
principle.
For irrigation, Allied agriculture activities and Allied Agro Industrial activities
categories, open access surcharges are not envisaged since, the RST rates are
highly subsidized and Open Access is not a viable proposal.
2.2: For EHT Open Access Consumers:

Surcharge is applicable to the following category of consumers;

General Purpose.

Large Industry.

Railway traction.

Heavy Industry.

Power Intensive Industry.

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Mini Steel Plant.
Sales rate per unit is computed at 100% load factor and which is tabulated
below:
Normal Normal
Demand
Energy Energy
Charge
charges. charges. Power factor
(Rs./
<=60% >60%
KVA)
(P/KWH) (P/KWH)
Tariff
250 520 415 0.9
rate

CD Increme Max units Avg. energy Demand charge Total

(KVA) ntal per month charge rate component rate
L.F (%)
Units (KWH) (P/KWH) (P/KWH) (P/KWH)
1 100 657 478.00 38.05 516.05

Surcharge(S) =T-(C+D+E)
Where T- sales rate per unit (516p)
C-BST rate for CESU / per unit (270p)
D-Transmission Charge / unit (25p)
R- The per unit cost of carrying regulatory assets.

Hence surcharge applicable to the above EHT category of open access

consumers is calculated as per above formula amounting to 221paisa per unit.
Further, for Emergency Supply to CGP/ IPP category of consumers the
surcharge is calculated to 415p/unit for EHT consumers based on the similar
practice.
3: Additional Surcharge:
At present two numbers of EHT consumers are availing open access power
under CESU’s area of supply. In a particular case open access surcharge is not
applicable since it is availing open access power from his own CGP situated outside
the jurisdiction of the Licensee. As per Clause -3 of OERC (Determination of open
access charges) Regulation-2006, additional surcharge is payable by the open access
consumers to meet the fixed cost of the distribution licensee. The following
methodology is adopted to arrive at the cost of additional surcharge.

• The fixed asset cost for the FY.2015-16 as approved by the commission in
RST order for the FY.2016-17 i.e Rs. 1619.15 Crores.
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 • The life cycle of the asset is taken as 20years.
• Total unit to be wheeled in the distribution network of CESU excluding the
EHT sales is equal to 8221.424 MU i.e. total power purchase minus the
EHT sales.
Additional Surcharge = (Approved asset cost as on 01.04.2016/ life
cycle of asset considered)/ Total unit to be wheeled in the
distribution network of CESU excluding the EHT sales =
(1619.15Cr/20year)/8221.42MU = 9.85 Paisa.
The additional surcharge is payable by all the open access consumers in
addition to other charges on the open access consumption.
From current financial year two EHT consumers are migrated to Eastern
Regional Power Grid from the Licensee’s area. The Licensee is yet to be compensated
on loss of EHT sales. The Licensee need to recover minimum fixed cost from all
Open Access Customers whether they avail power from owns CGP or any other
Utility. Hence additional surcharge of 9.85 paisa per unit may be allowed to be levied
on all open access customers.
4: Scheduling & System operation charges:
Intra state ABT regulations are applicable to all HT & EHT consumers
availing supply with load of 5 MVA and above. Such consumers when apply for
long or short term open access are liable to pay scheduling and operation charges
for effecting each change in scheduling.
CESU proposes that a sum of Rs.2000/ day or part thereof may be paid by
all open access customers.
5: Reactive Energy charges:
Reactive energy charges when applicable will be levied on all Open Access
consumers.
6: Miscellaneous charges:
Meter rent & customer charges applicable to EHT & HT consumers shall be
borne by all Open Access consumers.

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